The exercise that I am asking you to attempt is simple.
Let us take government as a black box whose internal workings we shall try not to apply our mind to. You are feeding your tax money into this black box and standing at the out gate to receive something in return -- some basic services that all respectable governments want to ensure for their people like potable water, food, shelter, roads, healthcare, education, power, security and the like.
The result at this out gate is startling every time you look at it afresh.
There are over 300 million Indians living in abject poverty, while those above them face deprivation in different spheres, whether it is in education or shelter or energy. Drastic improvement is required in the basic human development indicators. My belief is that there is a better chance of that happening if money is directly taken from the taxpayers and given to the needy in some form of cash transfer than if money is routed though the black box of the government, with all its inefficiencies and susceptibility to vested interests.
The government has already dabbled with some cash transfer schemes focusing on the girl child (Ladli, Dhanalakshmi, Janani Suraksha Yojana and so on) and more are being talked about. It is obvious that one hop in this transfer of cash can be reduced -- instead of the money going from the taxpayer to the government to the poor, it can be directly channelised to the poor, supported by a smart system of fiscal incentives.
There are many people, and companies, who would happily set aside money to sponsor a child, or a child's education, or pay for healthcare or food of the poor, as long as they can see the results.
Seeing the 100 students that have gained an education from your (tax) money definitely beats seeing where your tax money is going in the annual budget statement under the 'rupee goes to' head which reads something like this in the current year: 20 per towards interest payments (which is the largest head), 13 per cent on defence, 9 per cent on subsidies, 18 per cent on the central plan, 15 per cent to states as their share of taxes and duties, and so on.
The economists would have their own view on such a direct transfer mechanism and there would be questions on the practicality of the proposal, but such a scheme is likely to be more effective in denting the poverty numbers and taking us closer to our development goals than elaborate and inefficient government programmes, of which more are in the making by ministers in the new government.
Walk through even the most somnolent ministries and you are likely to see a flurry of activity as these new ministers get down to the task of formulating a 100-day agenda as if the agenda is an end in itself.
There has been an agenda on road development for the last few years. That did not yield roads. The power capacity addition programme did not bring in additional power capacity of any significant scale. If an agenda could substitute for action, we would be well on our way towards developed country status.
The new power minister -- who has been in the same ministry before -- reiterates his commitment to rural electrification and to power for all by 2012. The minister for small industries promises to address the credit needs of the sector. The heavy industries minister promises higher transparency in all transactions. The minister for housing and urban poverty alleviation talks about affordable housing for all and the plans for a slum-free city campaign. They could have been talking two or four or six years ago and would not have needed to change a single comma in their speeches.
We know that urban development is required. We know that people in a civilised society should not be forced to live in slums. We know that power is required. We know that the credit needs of the small scale sector need to be met. We know that the country needs adequate security. We know that there should be zero-tolerance for corruption.
What we need to know is what is being done to deliver results. What are the milestones that we should look out for standing at the out gate. That would be the real measure of any government's success. Nothing else!
